This may be due to the current version of pipeworks being outdated, or one of our modifications on the mod, but upon reaching the end of an unconnected pipe line, the item entity is not dropped.
The issue was confirmed with the latest version of the server's repository, with all pipes. I determined all pipes were affected after checking that when the unconnected end pipe was a vacuuming pipe, no entity would be sucked back in, meaning no entity would be dropped at all (which has to do with the common transport core).
I'll work on a theory that could solve this quickly.